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Energy Efficiency Resource Standard (EERS)

An Energy Efficiency Resource Standard (EERS) establishes specific, long-term targets for energy savings that utilities or non-utility program administrators must meet through customer energy efficiency programs. An EERS can apply to either electricity or natural gas utilities, or both, depending on the state, and can be adopted through either legislation or regulation. An EERS is similar in concept to a Renewable Energy Standard (RES) or Renewable Portfolio Standard (RPS). While an RES requires that electric utilities generate a certain percentage of electricity from renewable sources, an EERS requires that they achieve a percentage reduction in energy sales from energy efficiency measures. 

As of August 2014, twenty-four states have fully-funded policies in place that establish specific energy savings targets that utilities or non-utility program administrators must meet through customer energy efficiency programs. Though Ohio and Indiana had EERS policies in place in the past, these were rolled back in recent years. The strongest EERS requirements exist in Massachusetts, Rhode Island, and Vermont, which require almost 2.5% savings annually. For a complete summary of state-level EERS policies and impacts, see the State EERS Policy Brief.

A federal EERS would complement existing state-level energy efficiency standards by setting a national goal for energy savings that would be implemented over a specific period of time.  The American Clean Energy Security Act of 2009 (which did not become law) proposed a 5% efficiency target, with an option for governors to petition that an additional 3% of the reductions come from efficiency in their state. Because business-as-usual projections for efficiency savings in 2020 are already close to 5% of nationwide electricity sales, ACEEE views a 10% requirement as a more appropriate target, and one which would have a significant and positive impact on our economy. The proposed EERS in the Senate bill (ACELA), however, would have only required 4% savings by 2020, which would have produced no new energy savings, according to ACEEE.

At both the federal and state levels, an Energy Efficiency Resource Standard is a critical policy that lays the foundation for sustained investment in energy efficiency. The long-term goals associated with an EERS send a clear signal to market actors about the importance of energy efficiency in utility program planning, creating a level of certainty that encourages large-scale investment in cost-effective energy efficiency.

⇒ Find out which states have an EERS in place with ACEEE's State Energy Efficiency Policy Database.